Air Liquide Plans New Plants in Turkey in Bid to Outpace Economy

Dec. 5 (Bloomberg) -- Air Liquide SA, which is vying for
the top spot in the industrial-gas market with Linde AG, plans
to add more plants in Turkey as it seeks to outpace the
country’s expected economic growth.

The company, which sells gases such as oxygen and nitrogen
to clients in food to the steel industry, may consider building
another plant in Iskenderun, on the eastern Mediterranean coast
of Turkey, said Jerome Christin, general manager for Turkey, in
an interview in Istanbul. Such a project would take place after
a 190 million-lira ($93 million) expansion at Air Liquide’s
Aliaga plant, on the Aegean coast in western Turkey, is
completed in 2015.

The company, operating in about 80 countries, is cutting
jobs in France, Germany and Italy, and Chief Executive Officer
Benoit Potier is poised to announce a strategy this month to
deal with Europe’s economic woes, growing industrial capacity in
emerging markets, cheaper U.S. gas, and rising demand for
health-care services and electronic goods such as tablets.
Turkey is budgeting for gross domestic product growth of 4
percent for 2014 and 5 percent for 2015 and 2016.

“Turkey is such a strategic country in the world because
of its size and growth potential,” Christin said. “Therefore
there is a big room for growth as the trend in Turkish
industrial companies is to outsource industrial gases.”

Air Liquide aims growth at around 10 percent in Turkey, he
said.

Services

Linde, based in Munich, Germany, expanded in the Turkish
market in 2007 by buying Birlesic Oksijen Sanayi AS for 92
million euros ($125 million) from Koc Holding AS, Turkey’s
biggest business group. Air Liquide’s Aliaga expansion project
follows its purchase of an air separation unit at the same site
from Petkim Petrokimya Holding AS, Turkey’s biggest
petrochemicals producer, for $39 million in 2011.

Air Liquide, which opened a plant in Polatli, near the
capital Ankara, in November as part of a 110 million-lira
investment, is also considering a plant in the Marmara region,
Christin said.

Air Liquide is betting its offering of custom-made
equipment for delivery of gas in processes used by its customers
will give it an edge in a crowded market.

“The Turkish market is in over-capacity, therefore
companies offering value-added services can grow in the
market,” Christin said. “Our added-value services are
measurable and our customers can save about as much as 20
percent with our value-added services.”